Human Resources Committee on Dec. 10th, 2024

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

Welcome to the committee, Ms. Volk.

You are the president and CEO of CMHC. You talked about your mission, which includes the important mandate of administering all the programs associated with the national housing strategy that has been adopted.

You have only recently taken up your post, but there are people there to support you. I would like to know what your personal assessment of the various programs is.

Given that the objective of the national housing strategy is to achieve and ensure housing affordability for people, is it a success, overall? If not, what do you think needs to be done to change things?

[Coleen Volk]

That's a big question.

There are many components of the national housing strategy. As its central core it has the desire to improve affordability of housing for many vulnerable groups and vulnerable populations, including seniors and women and children fleeing violence.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

I'm sorry to interrupt you, but we don't have a lot of time. I am quite familiar with the programs, but I want to know whether you think they are meeting their objectives.

In its latest report, CMHC estimated that we would need to create 3.5 million housing units by 2030 in order to solve the affordability crisis, and here we are in 2024, soon to be 2025.

The government adopted a strategy to meet that challenge, but it is not happening. What needs to be changed in order for that to happen?

[Coleen Volk]

Yes, in my opinion, the national housing strategy is having an effect.

I firmly believe that no one level of government can solve the housing crisis. I believe this is an all-hands-on-deck issue. We need support from the provinces, municipalities, the private sector and non-profit groups. It is a collection of partnerships that will help us get through the housing crisis that we find ourselves in now.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

Yes, this is a shared responsibility, with housing falling under the jurisdiction of Quebec and the provinces.

But the fact is that significant amounts of money are being invested. We have groups coming to us and saying it is hard to find affordable housing. Some of them have strongly recommended that at least 20% be non-market housing. Our committee also recommended this in its report on the financialization of housing.

You spoke about a number of things. You said that you administer a lot of loan programs, the money sometimes takes several forms, and definitions of affordability are not the same in all the programs.

That said, I am asking you to tell us what your own vision is, as the new president.

At this stage, should you not be recommending that these programs be reviewed so they can be focused more on how to meet the high demand for social housing and affordable housing?

[Coleen Volk]

I believe there are many programs in the national housing strategy that are making a difference.

In the ACLP, the apartment construction loan program, we're financing mortgages in the amount of almost $4 billion a year. It's improving the affordability of housing in Canada.

There are many programs targeting contributions and grants that allow the deeper affordability that you're talking about, which is real social housing. There are many programs that are oversubscribed. We're able to fill them with—

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

I'm sorry to interrupt you again. I don't like doing it.

I am familiar with the multitude of programs that are offered and what their objectives are. We sometimes make announcements in our ridings about money that will be spent on a particular program. In some cases, we get the impression that it is recycled money, the same money going around and around.

My question is simple. You can answer yes or no. Do you think some programs should be tightened up?

Should some programs be defined better or should how the money is being spent be reviewed?

Do you think the various programs will meet the objective established in the housing affordability strategy? If not, should we be doing things differently?

[Coleen Volk]

The demand is great. Does the demand exceed what's available to bring to the table at the moment? It's likely. There is a crisis in affordability, particularly in deeply affordable housing, which is what I think you're primarily talking about.

I think there are solutions that involve multiple partners, including the federal government, the provincial governments and the municipalities. We're working very closely with those partners and with the non-profit community as well.

[The Chair, Liberal, Bobby Morrissey]

Thank you.

Thank you, Ms. Chabot.

Ms. Zarrillo, you have six minutes.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you very much.

There's so much to say and ask, and we're not going to have enough time, but I really appreciate your being here.

This is an opportunity to change the culture at CMHC. The previous CEO was at this committee many times, and we raised issues at this committee around the fact that you need to be speaking to people on the ground who are suffering and who are becoming homeless. I'm hoping that this is an opportunity for you to change the culture at CMHC.

I might have some questions about that. They are related to the reallocation of CMHC policy staff to internal government staff. Maybe I could get your thoughts on how the new thinking needs to be at the highest levels, because the way we have been thinking isn't solving the problem.

What I wanted to really get on the table today was this problem around REITs and the loans. We know that low-income tenants, persons with disabilities, single parents, seniors and immigrants are suffering from evictions and above-guideline rent increases in many buildings that are owned by real estate investment trusts.

I want to let you know that CMHC is financing billionaire REITs, and it is resulting in low-income tenants being evicted. Starlight alone, which is the asset manager for the government in their public service pension board investments, is boasting about $425 million in low-interest CMHC debt, and it's using this as a selling feature to unload purpose-built stable rental housing.

I have it here from RENX, the Real Estate News Exchange, that Starlight is selling 26 properties, and they are saying that:

Properties in the portfolio have in-place financing at fixed below-market interest rates, of which a significant portion is Canada Mortgage and Housing Corporation-insured. The $425 million in CMHC debt, with a weighted average 2.52 per cent interest rate and remaining term of 4.2 years, is assumable subject to lender consent.

I also want to share with you that the CEO of RioCan said:

The cheapest debt in town is CMHC-guaranteed debt, which you can put on rental residential buildings, so we're quite hopeful that our first CMHC transaction will take place before the end of the summer.

I'll also let you know that there was a news story out today that the tenants who are being evicted have no stable housing, and the fastest-growing population of homeless people, seniors, are now having to sue. RioCan is one of the companies that they are suing as part of a class action lawsuit because of overpaying rent potentially based on AI price fixing.

Mrs. Volk, we, or rather I—because I shouldn't speak for the committee—am out speaking to these seniors who are being displaced and asking me to find them a nursing home to live in. Single parents with kids with a disability are being evicted from their homes and have to find new homes and new schools and have to make new plans. It also includes immigrants who have already suffered desperate trauma in their home countries. They are the people I'm talking to, not the developers I worked with for eight years on city council. These are the people.

Do you think that that's a good culture for CMHC? They're helping greedy corporate CEOs and REIT holders to make profits while residents are being evicted and becoming homeless.

[Coleen Volk]

I'll start with some positives, but I will get to your question. I promise you.

Our mortgage loan insurance programs are the primary reason that there is rental construction in the country—

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

I'm going to stop you there, Ms. Volk, because I think you need to get out into the community.

A lot of purpose-built rental has gone by the wayside because of things like what Starlight is doing right now. They're unloading affordable rental housing so they can sell it to developers for 30-, 40- and 50-storey towers of luxury rental.

This government, in my community, is coming with $200 million in loans to try to get some affordable housing, which is pathetic, because they're not even giving money. They're asking for it back.

It's displacing people. In the context of knowing that those loans you're giving to Dream or any of these REITs.... It's not you. I'm sorry. I shouldn't say “you”. Those loans that CMHC is giving to Dream or these other REITs are actually going to buying land where they're taking down affordable housing.

I'll restart your question, but please, in the context, this land didn't just come from anywhere. This is land people were living on, sometimes for decades.

[Coleen Volk]

I understand. Thank you for the clarification.

It is important, though, to note that there would be very little rental construction—if any—in Canada if it weren't for CMHC's insurance programs. We are the only game in town to provide insurance on purpose-built rental, and we are doing incredible volumes of it. Most of that is with private sector players, and thank heaven that the private sector players are active, because without them we wouldn't be having any purpose-built rental in the country at all. They play an important role in the ecosystem of housing.

I understand the particular concern you're raising about the ability to demolish more affordable rental spaces and replace them with luxury rentals. That is something we are concerned about. That is something the government is concerned about. It is the reason that the federal government announced its intention to look at and develop the Canada rental protection fund.

[The Chair, Liberal, Bobby Morrissey]

We have Mrs. Gray for five minutes.

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Thank you, Mr. Chair.

At this committee on September 27, 2023, the Liberal housing minister was asked about Canada Mortgage and Housing Corporation—CMHC—staff bonuses, and he committed to review the process by which bonuses are provided to staff.

Has the housing minister initiated any conversation with you, as the president and CEO of CMHC, or with any other executive, since that commitment over a year ago?

[Coleen Volk]

Thank you for the question. I'm not aware of what conversations he may have had with my predecessor.

Since my arrival, I have had many conversations with the board. We have an annual review of our compensation, and it is the board that determines the compensation approach for the—

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Right, but has the housing minister...? Have you had conversations with the housing minister on this?

[Coleen Volk]

I don't recall a specific conversation with the minister, but I suspect the minister will have spoken to the board since it's the board that approves our—

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Thank you.

Can you please table a list of any meetings or discussions that would have occurred with the minister on this issue?

[Coleen Volk]

Sure.

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Thank you.

Records show that in 2023 the total amount of individual incentive award bonuses provided to 2,283 CMHC staff in 2023 was roughly $26 million. That's an average of $11,623 per employee. Does that sound correct?

[Coleen Volk]

Yes. I'm just looking for my notes to verify that, but that's just about exact.

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Okay. Thank you.

Records show that CMHC had 2,320 employees, and 2,283 received bonuses. That means 98% of employees received bonuses. Does that sound correct?

[Coleen Volk]

I'm sorry. Did you say that was in 2023?

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

That was 2023.